Giverny Capital Asset Management, LLC, an investment management company, recently published its third-quarter 2025 investor letter. A copy of the letter can be downloaded here. The portfolio generated good results in the third quarter and returned 6.78% compared to 8.12% for the S&P 500. YTD, the fund returned 12.57% compared to 14.83% for the index. Additionally, you can review the fund’s top 5 holdings to see its best picks for 2025.
In its third-quarter 2025 investor letter, Giverny Capital Asset Management highlighted stocks such as Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM). Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) manufactures, packages, tests, and sells integrated circuits and other semiconductor devices. The one-month return of Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) was 3.67%, and its shares gained 57.27% of their value over the last 52 weeks. On December 08, 2025, Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) stock closed at $301.87 per share, with a market capitalization of $1.566 trillion.
Giverny Capital Asset Management stated the following regarding Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in its third quarter 2025 investor letter:
“During the quarter, we initiated a 3.5% position in Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM), the world’s foremost semiconductor manufacturer. Since its founding by former Texas Instruments executive Morris Chang in 1987, Taiwan Semi has operated as a foundry, making chips designed by others. This was a different model from Intel, which both designed and manufactured its own chips. Intel has been a great company for decades, but eventually it fell behind on the implementation of EUV lithography, which has become table stakes technology for chip manufacturers.
Meanwhile, chips are becoming more complicated to manufacture as designers pack more transistors onto tiny slivers of silicon. In 2023, the newest generation of Nvidia chips was carrying electric signals separated by three nanometers on a chip. For reference, the width of a human hair is 50,000 nanometers. Samsung and Intel, the best competitors to TSMC, struggled to make chips at this specification and TSMC began to look like a monopoly at the leading edge. Two years later, TSMC is making chips at two nanometers and is working on 1.4 nanometer chips. Intel and Samsung continue to struggle with yields at three nanometers. Again, the smaller the distance between transistors, the more signal a chip can carry. More signal equals more processing power…” (Click here to read the full text)
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is in 9th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 194 hedge fund portfolios held Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) at the end of the third quarter, compared to 187 in the previous quarter. In the third quarter of 2025, Taiwan Semiconductor Manufacturing Company Limited’s (NYSE:TSM) revenue increased 6% sequentially in NT. While we acknowledge the risk and potential of Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) and shared the list of fastest-growing semiconductor stocks to buy. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
